Hurricane Dorian: Economists pan price gouging laws as storm nears

— Georgia Gov. Brian Kemp has kept a brisk and proactive pace as Hurricane Dorian nears the coast, issuing mandatory evacuation orders and emergency declarations and authorizing a call-up of the Georgia National Guard.

“Businesses may not sell, or offer to sell at retail, any goods or services identified by the Governor ... at a price higher than the price at which the good or services were sold or offered for sale before the declaration of the State of Emergency,” according to the state’s law meant to combat price gouging.

“We do appreciate as much detailed information as you can provide and copies of any and all relevant documentation, including pictures,” the instructions read.

Carden calls this a “socially corrosive” measure that “siphons people’s attention from responding to the disaster to snitching on each other.” When the state forces prices to remain static despite a surge in demand, he added, “You almost certainly get black markets. It encourages hoarding.”

Kemp’s post highlighting the price-gouging law was met with thanks and support from many responders on social media.

“Now if we can get a gouging ban in Florida,” one post read. “Still down the road from a (gas) station that’s $6.99 a gallon.”

“Thank you SIR!” another read. “Does this affect HOTEL ROOMS too? Because the HOTEL ROOMS went up really high during hurricanes!”

That’s actually for the best, Carden says.

“If hotel room prices don’t change, maybe a large family (fleeing the storm’s path) comes to Atlanta and they get two rooms,” he said. “If the price of rooms doubles, that family might say, ‘OK we need to bite the bullet and stay in one room.’ That frees up another room.”

“If the goal is to get more water or ice or whatever, letting the price rise is the best way to do that,” he said. If selling bottled water or other commodities suddenly becomes more profitable, he explained, those conditions may entice enterprising sellers to enter the temporarily hot market.

“The more suppliers come in, and compete with each other, the more prices come down,” he said.